WORD OF MOUTH AS A NEW ELEMENT OF THE MARKETING COMMUNICATION MIX: ONLINE CONSUMER REVIEW

Customer online product reviews are an emerging market phenomena that is playing an increasingly crucial part in customers buying decisions as a novel type of word-of-mouth knowledge. This authors argue that online consumer reviews, a sort of product details created by users depending on individual usage experience, can serve as a new variant in the marketing communications mix, acting as free sales assistants to assist consumers in identifying products that best suit their unique usage conditions. This study proposes a normative methodology to solve a number of critical strategic concerns about customer evaluations. First, we explain when and how a seller s marketing communication plan should be adjusted in response to customer feedback. Our findings show that if review information is sufficiently useful, the two types of product information, namely seller-created positive product data and buyer-created literature review, will communicate. When the product price is minimal and/or there are enough expert (more intelligent) users, for example, the two types of information are complementary, and the seller s best reply is to boost the number of product attribute message provided via marketing communications after the reviews are accessible. When the product cost is high and there are a large number of rookie (less sophisticated) product users, the two types of information are substitutes, and the seller s best reaction is to minimize the quantity of product attribute information it contains, even if it is free.